This release was issued under a previous government.
“We are proud that our government is meeting the growing demands for core services like health, education and transportation, despite fluctuating revenues,” said President of Treasury Board and Minister of Finance Doug Horner. “As we look to the future, our government must adapt to the changes in revenues through long-term planning and by utilizing the financial tools that give us the greatest advantage.”
In the first six months of the fiscal year, resource revenue was $1.4 billion lower than expected. This change was due to global economic factors, a growing discount on Alberta bitumen prices relative to international prices for crude, a higher exchange rate and lower land lease sales. These factors were partially offset by higher than expected corporate income tax, as well as stronger investment income and increased revenue from gaming and liquor.
“The biggest factor affecting our resource revenue right now is the lack of market access for our oil,” said Horner. “We have one customer and one means to ship our product to them. On the other hand, our customer has many different suppliers to choose from. This is not a good situation to be in and it’s costing us dearly. The differential is about $29 a barrel right now - multiply that by two-and-a-half million barrels a day and the result is a tremendous impact to Alberta’s finances.”
Expense for the first six months was $293 million higher than expected due to funding for forest fires and severe hail storms. These increases were partially offset by lower operating and capital spending. The province is on track for in-year savings of $500 million and results-based budgeting, which is expected to find efficiencies and improved outcomes, is beginning. Based on results so far this fiscal year, Alberta continues to forecast a deficit of between $2.3 and $3 billion.
“Albertans need to know in Budget 2013 we will present a plan that will include their priorities,” said Horner. “They have made it clear that schools and hospitals are needed and so is continued investment in key infrastructure like Highway 63. We will have an operating plan, a savings plan and a fully-funded capital plan that speaks to a growing province that expects to add the equivalent of another city the size of Calgary to our population over the next two decades.”
Alberta’s economy overall is on track for a strong 2012. Key economic indicators, including real GDP growth, business investment, consumer spending and employment gains are all on pace for significant gains, and Alberta is leading the country in many categories. Alberta’s population continues to climb faster than anywhere else in Canada, as net interprovincial migration hit a six-year high. The province’s population is now expected to grow by 2.5 per cent in 2012.
2012-13 Second Quarter Actuals for the six months ended September 30 ($ millions)
Backgrounder: Alberta’s economy continues to post strong growth
Media inquiries may be directed to:
Robyn Cochrane
Press Secretary
Treasury Board and Finance
780-415-1541
780-668-2256 (cell)
[email protected]
To call toll free within Alberta dial 310-0000.
November 28, 2012Alberta’s economy continues to post strong growth
Alberta’s economy has recorded strong performance in many areas over the past six months despite continued global economic weakness. The highest provincial population growth (interprovincial migration), the lowest unemployment rate and the highest job gains were all key indicators of the province’s continued strength.
- Alberta has had more residents arrive than leave the province for six straight quarters. Over the last two quarters of data, net interprovincial migration hit a six-year high of around 10,000 per quarter.
- Alberta - an engine of national employment growth - has created more jobs than any other province so far this year. Alberta has gained 2.8 per cent, or 58,600 jobs, year-to-date.
- The unemployment rate, at 4.5 per cent as of October, is the lowest in the country.
- Albertans sharply increased their spending on goods and services this year. Retail sales are up by nine per cent in the first eight months of the year over the same time last year, with automobile sales posting especially large gains. This is nearly triple the national increase.
- Real GDP is forecast to expand by 3.7 per cent this year, roughly in line with Budget 2012 and the first quarter estimate of 3.8 per cent. It is nearly double the growth forecast for Canada and the United States.
- Oil sands and non-mining investment remains on track to expand this year. Overall real business investment is expected to increase by over five per cent this year.
- Housing starts are up 34 per cent through the first 10 months of this year over the same time last year.
For more detailed information, a copy of the 2012-2013 Second Quarter Fiscal Update is available at www.finance.alberta.ca.
According to Statistics Canada, Alberta is leading the country in many key economic categories in 2012 when compared to the Canadian average (figure 1).
Figure 1:
Alberta ranks 1st (averaged over 2012) | ||
| Alberta | Canada |
Population growth | 2.5% | 1.1% |
Unemployment rate | 4.7% | 7.3% |
Retail sales growth | 8.9% | 3.1% |
Employment growth | 2.8% | 1.0% |
Government’s forecast for the price of oil in Budget 2012 was in line with private sector forecasts and other governments at the time (figure 2).
Figure 2:
2012 oil price forecasts - WTI ($US/barrel) | |
Canada | $100.70 |
Alberta | $98.71 |
British Columbia | $97.07 |
Saskatchewan | $100.50 |
Ontario | $100.00 |
Average of all private forecasts - $99.38 | |
In the past three-plus years, the differential between the world oil price (Brent), and the North American price (WTI) and what Alberta producers get for bitumen (WCS) has grown. Today, it is about $29 per barrel (figure 3 - click link to view):
http://finance.alberta.ca/whatsnew/newsrel/2012/2nd-quarter-chart-oil-prices.jpg
Alberta is seeing strong population growth, with people coming from all parts of Canada. The last two quarters of data have been especially strong, with net interprovincial migration hitting a six-year high of around 10,000 per quarter (figure 4 - click link to view):
http://finance.alberta.ca/whatsnew/newsrel/2012/2nd-quarter-chart-net-interprovincial-migration.jpg
Media inquiries may be directed to:
Robyn Cochrane
Press Secretary
Treasury Board and Finance
780-415-1541
780-668-2256 (cell)
[email protected]
To call toll free within Alberta dial 310-0000.
Backgrounder
November 28, 2012Alberta’s economy continues to post strong growth
Alberta’s economy has recorded strong performance in many areas over the past six months despite continued global economic weakness. The highest provincial population growth (interprovincial migration), the lowest unemployment rate and the highest job gains were all key indicators of the province’s continued strength.
- Alberta has had more residents arrive than leave the province for six straight quarters. Over the last two quarters of data, net interprovincial migration hit a six-year high of around 10,000 per quarter.
- Alberta - an engine of national employment growth - has created more jobs than any other province so far this year. Alberta has gained 2.8 per cent, or 58,600 jobs, year-to-date.
- The unemployment rate, at 4.5 per cent as of October, is the lowest in the country.
- Albertans sharply increased their spending on goods and services this year. Retail sales are up by nine per cent in the first eight months of the year over the same time last year, with automobile sales posting especially large gains. This is nearly triple the national increase.
- Real GDP is forecast to expand by 3.7 per cent this year, roughly in line with Budget 2012 and the first quarter estimate of 3.8 per cent. It is nearly double the growth forecast for Canada and the United States.
- Oil sands and non-mining investment remains on track to expand this year. Overall real business investment is expected to increase by over five per cent this year.
- Housing starts are up 34 per cent through the first 10 months of this year over the same time last year.
For more detailed information, a copy of the 2012-2013 Second Quarter Fiscal Update is available at www.finance.alberta.ca.
According to Statistics Canada, Alberta is leading the country in many key economic categories in 2012 when compared to the Canadian average (figure 1).
Figure 1:
Alberta ranks 1st (averaged over 2012) |
||
|
Alberta |
Canada |
Population growth |
2.5% |
1.1% |
Unemployment rate |
4.7% |
7.3% |
Retail sales growth |
8.9% |
3.1% |
Employment growth |
2.8% |
1.0% |
Government’s forecast for the price of oil in Budget 2012 was in line with private sector forecasts and other governments at the time (figure 2).
Figure 2:
2012 oil price forecasts - WTI ($US/barrel) |
|
Canada |
$100.70 |
Alberta |
$98.71 |
British Columbia |
$97.07 |
Saskatchewan |
$100.50 |
Ontario |
$100.00 |
Average of all private forecasts - $99.38 |
|
In the past three-plus years, the differential between the world oil price (Brent), and the North American price (WTI) and what Alberta producers get for bitumen (WCS) has grown. Today, it is about $29 per barrel (figure 3 - click link to view):
http://finance.alberta.ca/whatsnew/newsrel/2012/2nd-quarter-chart-oil-prices.jpg
Alberta is seeing strong population growth, with people coming from all parts of Canada. The last two quarters of data have been especially strong, with net interprovincial migration hitting a six-year high of around 10,000 per quarter (figure 4 - click link to view):
http://finance.alberta.ca/whatsnew/newsrel/2012/2nd-quarter-chart-net-interprovincial-migration.jpg
Media inquiries may be directed to:
Robyn Cochrane
Press Secretary
Treasury Board and Finance
780-415-1541
780-668-2256 (cell)
[email protected]
To call toll free within Alberta dial 310-0000.